Abstract

In the context of Fund-supported adjustment programs, there is now much discussion of growth-oriented adjustment. This involves the integration of traditional short-term adjustment—essentially the correction of external and internal imbalances through aggregate demand management—with longer-term structural measures aimed at stimulating the supply side of the economy. The Fund has been criticized for not paying enough attention to growth; the most common claim is that the fiscal and monetary policy prescriptions that characterize short-term adjustment programs are inimical to growth, and that this reflects inadequate concern. A similar line of reasoning is used by those who argue that the Fund has lacked concern about the social implications of adjustment, and in particular its impact on poverty and inequality.